Speed has always been crucial to successful trading. However, for firms engaged in electronic and algorithmic trading, the speed of the trading infrastructure is almost as important as the trading algorithm itself. Most discussions involving latency optimization revolve around various equipment such as feed handlers or servers that process market data, order management, analytics and risk.

Besides cloud computing and virtualization, low latency seems to be another buzz word of the year. But reading through all the publications can get a little confusing. While the business benefits of having a lower latency (=faster) network than your competitor are obvious and understandable the technology behind it becomes a little blurry. Let me try to explore some of the myths that exist around low latency technology.